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Step 1:
Are You Ready?
Knowledge and
experience are the keys to successful real estate transactions.
One of the keys to
making the home-buying process easier and more understandable is
planning. In doing so, you'll be able to anticipate requests from
lenders, lawyers and a host of other professionals. Furthermore,
planning will help you discover valuable shortcuts in the
home-buying process. |
Buyer's Guide
Step 1: Are You Ready?
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Do You Know What You
Want?
Whether you are a first-time homebuyer or entering the marketplace as a
repeat buyer, you need to ask why you want to buy. Are you planning to
move to a new community due to a lifestyle change or is buying an option
and not a requirement? What would you like in terms of real estate that
you do not now have? Do you have a purchasing timeframe?
Whatever your answers,
the more you know about the real estate marketplace, the more likely you
are to effectively define your goals. As an interesting exercise, it can
be worthwhile to look at the questions above and to then discuss them in
detail when meeting with local REALTORS®.
Do You Have The Money?
Homes and financing are closely intertwined. (Financing is the difference
between the purchase price and the down payment, commonly referred to as
debt or the mortgage.) The good news is that over the years new and
innovative loan programs have evolved which require a 5 percent down
payment or less. In fact, a number of programs now allow purchasers to buy
real estate with nothing down.
In addition to a down
payment, purchasers also need cash for closing costs (the final costs
associated with closing the loan). Several newly emerging loan programs
not only allow the purchase of a home with no money down, but also
underwrite closing costs.
Not everyone, however,
elects to purchase with little or no money down. Less money down means
higher monthly mortgage payments, so most homebuyers choose to buy with
some cash up front.
As to closing costs, in
markets where buyers have leverage, it may be possible to negotiate an
offer for a home that requires the owner to pay some or all of your
settlement expenses. Speak with local REALTORS® for details.
Is Your
Financial House in Order?
Those great loans with little or nothing down are not available to
everyone: You need good credit. For at least one year prior to purchasing
a home, you should assure that every credit card bill, rent check, car
payment and other debt is paid in full and on time.
NEXT STEP: Get A REALTOR®
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